Electronic financial transactions are commonly facilitated using credit cards, debit cards, stored-value cards and smart cards. Despite the technological advancements in electronic commerce, each of these cards have definite disadvantages. For example, electronic commerce on the Internet is primarily facilitated using credit cards. As a result, individuals without credit cards cannot enjoy the convenience, selection and competitive pricing made possible by online shopping. These individuals may not have acceptable credit or may simply be concerned about the security of their financial information on the Internet. In addition, many people prefer cash transactions and frequently use money orders, cashier's checks, traveler's checks or other secure financial documents or instruments. As a result, a large segment of society is essentially excluded from purchasing goods and services via the Internet. In addition, once money orders, cashier's check and traveler's check are issued in a particular currency, they cannot easily be converted to another currency without cashing them for their full value.
One side effect of the boom in Internet commerce is the dramatic increase in the number of goods shipped via delivery services, such as the United States Postal Service, United Parcel Service and Federal Express, among a few. Despite the scope of information available on the Internet, customers are not always exactly sure what they will receive when their package arrives. Accordingly, consumers often would prefer to purchase items by cash on delivery (COD). Internet merchants, however, often require payment by credit card or check (with significant delays in shipment) and do not offer COD as a payment option or make the process so complicated as to make it undesirable by the consumer. Merchants disfavor COD because of the delay in receiving payment from the delivery service. Yet, COD simplifies the return process, is customer friendly and allows the customer to inspect the goods for damage before payment is made to the merchant.
Unlike credit cards, smart cards can be used in many applications. Despite this flexibility and great technological potential, there is little or no standardization for smart card systems. Thus, many different non-compatible smart card systems currently exist. The data storage and multiple application capability of smart cards also provides security concerns. For example, the cardholder does not want his or her doctor to gain access to credit card and bank account information on a smart card that also contains the cardholder's medical history. Similarly, the cardholder does not want his or her bank to gain access to medical history on a smart card that also contains the cardholder's credit card and bank account information.
Moreover, smart cards are not completely invulnerable to failure and loss. For example, a smart card is less resistant to damage from wear and tear, heat, mishandling and contaminants, such as water, dirt, detergent, etc., than a credit card, debit card or magnetic stripe based stored-value card. If the smart card fails, the cardholder typically will lose the amount of money stored on the failed smart card. Similarly, stored-value cards have the disadvantage of losing the monetary value of the card if the card is lost, stolen, damaged or destroyed. Credit cards and debit cards raise other concerns, such as thieves draining bank accounts, running up large credit card charges and/or identity theft before the theft is discovered.
Accordingly, there is a need for a money card system that is convenient, easy to use, does not require good or any credit, is useable by individuals having low incomes, is interchangeable with cash, is available in many currencies, can be used in COD transactions, and is safer than cash, checks, money orders, cashier's checks, traveler's checks, ATM cards, credit cards, debit cards, stored-value cards and smart cards or other forms of monetary exchange generally available to the public.